Upheld: poor claim handling, inadequate asbestos management, disputed settlement scope complaint against Lloyds Bank General Insurance Limited
Financial Ombudsman decision DRN-6391782 of 2026-06-01T00:00:00+00:00. poor claim handling, inadequate asbestos management, disputed settlement scope complaint against Lloyds Bank General Insurance Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6391782 |
|---|---|
| Decision date | 2026-06-01T00:00:00+00:00 |
| Firm | Lloyds Bank General Insurance Limited |
| Product | Home insurance |
| Claim type | poor claim handling, inadequate asbestos management, disputed settlement scope |
| Outcome | Upheld |
| Remedy | Lloyds Bank General Insurance Limited must: (1) Reimburse Mr C and Ms T the costs paid for asbestos testing on 25 June 2025 and R&D survey on 17 October 2025 upon receipt of evidence; (2) Pay 8% per year simple interest on these amounts from the date costs were incurred to the date of reimbursement; (3) Pay £1,100 compensation for distress and inconvenience. |
Summary
Mr C and Ms T complained to Lloyds Bank General Insurance Limited about the handling of their home insurance claim following water damage in January 2025. The complaint centred on unreasonable delays, inadequate asbestos management (including improperly stored asbestos materials and failure to identify all asbestos present), and a disputed settlement offer. Lloyds acknowledged errors and offered £1,100 compensation plus a new field consultant to review outstanding issues. The ombudsman upheld the complaint, requiring Lloyds to reimburse the costs Mr C incurred for asbestos testing (25 June 2025) and an R&D survey (17 October 2025), plus 8% interest, and to pay the £1,100 compensation. The ombudsman found Lloyds's asbestos management was inappropriate and that Mr C reasonably commissioned his own survey given Lloyds's failures.
The Ombudsman's reasoning
The ombudsman found that while Lloyds's usual practice of contractors identifying and testing suspected asbestos materials was reasonable, Lloyds failed to appropriately manage the asbestos at Mr C's property. The R&D survey Mr C commissioned identified asbestos materials that Lloyds had not identified, particularly in the kitchen steel supports following ceiling removal. The ombudsman determined it was reasonable for Mr C to arrange asbestos testing and the R&D survey given valid concerns about Lloyds's handling, and that Lloyds should reimburse these costs as it would have had to arrange them anyway. Regarding the settlement dispute, the ombudsman found a further review of scope of works was needed and that instructing a new field consultant was an appropriate way to progress matters. The £1,100 compensation was found reasonable for the substantial distress and inconvenience caused by delays and poor asbestos management over a prolonged period.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Lloyds Bank General Insurance Limited, all decisions | 1,337 | 25% |
| Home insurance, all decisions | 21,293 | 38% |
Source
Read the original decision on the Financial Ombudsman Service website